Financial Results for 4/2010- -9/2010 9/2010 Financial Results for - - PowerPoint PPT Presentation

SLIDE 1

Financial Results for 4/2010 Financial Results for 4/2010-

• 9/2010

9/2010 and and Financial Forecasts for 4/2010 Financial Forecasts for 4/2010-

• 3/2011

3/2011

November 4 , 2010 November 4 , 2010

Statements made in this overview of operations regarding Kyushu Electric Power’s strategies and forecasts and other statements that are not historical facts are forward-looking statements based on management’s assumptions and beliefs in light of information currently available, and should not be interpreted as promises

• r guarantees.

Owing to various uncertainties, actual results may differ materially from these statements. Investors are hereby cautioned against making investment decisions solely on the basis of forward-looking statements contained herein.

SLIDE 2

■ ■ ■ ■ ■ ■ Table of Contents Table of Contents ■ ■ ■ ■ ■ ■

Financial Results and Forecasts Summary

FY2010 2nd Quarter Financial Results Summary P1 FY2010 Summary of Full-Year Financial Results Forecasts P2 Key Fundamentals and Sensitivity Factors (Non-Consolidated) P3

FY2010 2nd Quarter Financial Results

Electricity Sales Volume P4 Shift in Large-Scale Demand (by month) P5 Electricity Generated and Received P6 Income Statement Summary (Non-Consolidated) P7 Explanation of Ordinary Revenue (Non-Consolidated) P8 Explanation of Ordinary Expenses (Non-Consolidated) Personnel, Fuel P9 Explanation of Ordinary Expenses (Non-Consolidated) Maintenance, Depreciation P10 Explanation of Ordinary Expenses (Non-Consolidated) Purchased Power, Others P11 Balance Sheet Summary (Non-Consolidated)） P12 Income Statement Summary (Consolidated) P13 Segment Information P14 Cash Flow Summary (Consolidated) P15

FY2010 Full-Year Results Forecasts

Summary Versus Previous Announced Forecast P16 Income Statement (Non-Consolidated) Versus Previous Announced Forecast P17 Cash Flow (Non-Consolidated) Versus Previous Announced Forecast P18 Income Statement (Non-Consolidated) Versus Previous Year P19 Segment Information Versus Previous Year P20 Cash Flow (Non-Consolidated) Versus Previous Year P21 *Figures for FY2010 2nd quarter financial result is accumulated total from Apr.1,2010 to Sep.30,2010.

SLIDE 3

■

Financial Results and Forecasts Summary

SLIDE 4

■ ■ FY2010 2nd Quarter Financial Results Summary FY2010 2nd Quarter Financial Results Summary ■ ■ １

Consolidated

(Unit: Billions of Yen/%)

FY2010/2Q FY2009/2Q Change

vs FY2009/2Q

Sales 736.7 726.4 10.3 101.4 Operating Income 76.1 82.5

• 6.3

92.3 Ordinary Income 57.2 67.5

• 10.2

84.8 (Extraordinary Losses) (18.4) (-) (18.4) (-) Net Income 21.8 42.6

• 20.8

51.2 Non-Consolidated

(Unit: Billions of Yen/%)

FY2010/2Q FY2009/2Q Change

vs FY2009/2Q

Sales 690.1 680.4 9.7 101.4 Operating Income 71.6 77.7

• 6.0

92.2 Ordinary Income 54.0 62.2

• 8.2

86.7 (Extraordinary Losses) (18.3) (-) (18.3) (-) Net Income 20.2 38.7

• 18.5

52.2 82.5 76.1 67.5 57.2 42.6 21.8 736.7 726.4 400.0 500.0 600.0 700.0 800.0 FY2009/2Q FY2010/2Q (Bil. Yen) 0.0 50.0 100.0 (Bil. Yen)

Operating income (right axis) Ordinary income (right axis) Net Income for Quarter (right axis) Sales (left axis)

77.7 71.6 62.2 54.0 38.7 20.2 690.1 680.4 400.0 500.0 600.0 700.0 FY2009/2Q FY2010/2Q (Bil. Yen) 0.0 50.0 100.0 (Bil. Yen)

Non-Consolidated Consolidate

Note: As of the end of 2Q/2010, 66 subsidiaries were subject to consolidated accounting Breakdown:

Consolidated subsidiaries: 35 companies (an increase of 1 company from the end of FY2009:1 new company) Equity method companies: 31 companies (no change from the end of FY2009: 1 new company, 1 company excluded)

Summary: On both a consolidated and non-consolidated basis, an increase in sales and decreased profit for the first time in two quarters. In the electricity business: ・ Higher electricity sales due to an increase in electricity sales volume and

• ther factors

・ Increase in fuel costs due to an increase in electricity sales volume and rising fuel prices ・ Booking of extraordinary losses due to the application of the accounting standard concerning Accounting for Asset Retirement Obligations

SLIDE 5

■ ■ FY2010 Summary of Full FY2010 Summary of Full-

• Year Financial Results Forecasts

Year Financial Results Forecasts ■ ■ ２

Consolidated

(Unit: Billions of Yen/%)

FY2010 FY2009 Change Vs FY2009 Sales 1,471.0 1,444.9 26.1 101.8 Operating Income 96.0 99.7

• 3.7

96.3 Ordinary Income 62.0 67.6

• 5.6

91.7 (Extraordinary Losses) (18.4) (-) (18.4) (-) Net Income 24.0 41.8

• 17.8

57.4 Non-Consolidated

(Unit: Billions of Yen/%)

FY2010 FY2009 Change Vs FY2009 Sales 1,376.0 1,339.8 36.2 102.7 Operating Income 85.0 84.9 0.1 100.1 Ordinary Income 52.0 50.3 1.7 103.3 (Extraordinary Losses) 18.3 (-) 18.3 (-) Net Income 18.0 28.3

• 10.3

63.6

Summary: On consolidated basis, sales expected to increase and profit to decrease; on non-consolidated basis, both sales and profit expected to increase

In the electricity business:

・ Higher electricity sales due to an increase in electricity sales volume and other factors. ・ Reduction in maintenance and overhead expenses due to thorough cost reductions across management in general ・ Booking of extraordinary losses due to application of accounting standards for asset retirement obligations In energy related business: ・ Decrease in sales including construction work

99.7 96.0 67.6 62.0 41.8 24.0 1,471.0 1,444.9 0.0 500.0 1,000.0 1,500.0 FY2009 FY2010 (Bil. Yen) 0.0 50.0 100.0 (Bil. Yen)

Operating income (right axis) Ordinary income (right axis) Net Income for Year (right axis) Sales (left axis)

84.9 85.0 50.3 52.0 28.3 18.0 1,376.0 1,339.8 0.0 500.0 1,000.0 1,500.0 FY2009 FY2010 (Bil. Yen) 0.0 50.0 100.0 (Bil. Yen)

Non-Consolidated Consolidate

Dividend Payment of stable dividends is our fundamental policy, and we intend to pay an annual dividend of 60 yen per share. (interim dividend of 30 yen and year-end dividend of 30 yen) * Both the same amount as the previous year.

SLIDE 6

■ ■ Key Fundamentals and Sensitivity Factors (Non Key Fundamentals and Sensitivity Factors (Non-

• Consolidated)

Consolidated) ■ ■ ３

Key Fundamentals (Non-Consolidated) Sensitivity Factors (Non-Consolidated)

2nd Half Full Year

Exchange rate (1Yen/$) 1.3 2.7 Crude Oil CIF Price (1$/b) 0.8 1.7 Water Flow Rate (1%) 0.1 0.4 Nuclear Power Generation Capacity Utilization Rate (1%) 1.3 2.6

FY2010

*1 Above figures show impact on fuel costs and cost of purchased power. *2 Impact of water flow rates and nuclear power generation capacity utilization rates may change based on types of fuels used alternatively in power generation.

[Ref.] Electricity Sales Volume

86.7 TWh 83.4 TWh 3.3 TWh 42.8 TWh

Exchange rate

89 Yen/$ 93 Yen/$

• 4 Yen/$

90 Yen/$

Crude Oil CIF Price

80 $/b 69 $/b 11 $/b 82 $/b

Water Flow Rate

102.4 % 76.1 % 26.3 % 100.0 %

Nuclear Power Generation Capacity Utilization Rate

80.9 % 84.8 %

• 3.9 %

80.2 %

2nd Half FY2010 FY2010 FY2009 Change (Unit: Billions of Yen)

FY2009 (Reference)

2.0 1.3 0.2 2.1

SLIDE 7

■

FY2010 2nd Quarter Financial Results

SLIDE 8

■ ■ Electricity Sales Volume Electricity Sales Volume ■ ■ ４

Electricity Sales Volumes

(TWh/%)

Change %

14.9 1.1 107.7 29.0 1.1 104.1 43.9 2.2 105.3

General

31.9 1.4 104.6

Large-scale Industrial

12.0 0.8 107.1

Actual

Reposting

• vs. FY2009/2Q

Lighting Power Total

・ General demand increased by 1.4 TWh (4.6%) compared to the same period last year due to increased air-conditioning demand caused by rising summer temperatures over those of last year. ・ Demand from large-scale industrial companies increased by 0.8 TWh (7.1%) compared to the same period last year due to increased production of electrical and transportation machinery, chemicals and non-ferrous metals.

(TWh/%)

Change %

14.9 1.1 107.7

Low voltage

2.6 0.1 104.6

Other

0.4

• 0.1

98.8 17.9 1.1 107.0 10.6 0.1 101.1 15.4 1.0 106.3 26.0 1.1 104.1 43.9 2.2 105.3 【 Ref.】 Actual Electricity Sales Volumes (by sector) Demand

• ther than

under liberalization Lighting

Power Subtotal

Actual

• vs. FY2009/2Q

Total Demand under liberalization

Commercial Industrial Subtotal (TWh/%)

Change %

3.6 0.2 106.7

Electronics

2.5 0.1 104.3

Transportation Machinery

0.8 0.1 112.7 1.1 0.1 106.4 1.3 0.2 111.3 0.4

• 107.2

1.0 0.2 117.4 4.6 0.1 104.5 12.0 0.8 107.1

Large-scale Industrial Demand by Sector

Steel and Iron

• vs. FY2009/2Q

Actual

Others Total Chemicals Clay and Stone Non-ferrous Metals Machinery

SLIDE 9

■ ■ Shift in Large Shift in Large-

• scale Demand (by month)

scale Demand (by month) ■ ■ ５

90 100 110 120 130 April May Jun. Jul. Aug. Sept. Vs Same Month in 2009 (%)

Machinery Steel & Iron Chemicals Clay and Stone Non-ferrous Metals Total

1 Large Scale Electric Power Results by Month (by sector)

* Machinery refers to electrical machinery, machinery for transport, etc.

• 2. Change vs. Previous Year

【 確認】 ” I r p n & S t e e l " と " S t e e l & I r

• n

" はどちら が一般的でし ょ う か

(Units: TWh/%) V

• l

u m evs FY2009 V

• l

u m evs FY2009 V

• l

u m evs FY2009 V

• l

u m evs FY2009 V

• l

u m evs FY2009 V

• l

u m evs FY2009 V

• l

u m evs FY2009 0.535 111.6 0.542 108.5 0.594 106.1 0.646 104.4 0.635 105.4 0.632 105.8 3.584 106.7 0.166 112.2 0.191 117.8 0.160 98.1 0.166 107.4 0.178 101.1 0.194 103.2 1.055 106.4 0.203 124.6 0.208 113.4 0.203 105.9 0.216 107.9 0.217 108.2 0.221 109.9 1.268 111.3 0.084 114.4 0.080 102.1 0.078 102.1 0.070 106.4 0.077 120.6 0.064 99.2 0.453 107.2 0.151 122.3 0.158 120.9 0.159 114.7 0.170 114.2 0.171 118.9 0.163 114.3 0.972 117.4 1.850 110.8 1.900 108.5 1.971 105.2 2.106 105.1 2.112 106.9 2.095 106.5 12.034 107.1 Aug. Sept. FY2010/2Q April May Jun. Jul. Machinery*

Steel & Iron Chemicals Clay and Stone Non-ferrous Metals

Total

SLIDE 10

■ ■ Electricity Generated and Received Electricity Generated and Received ■ ■ ６

Volume of Electricity Generated and Received (Units: TWh, %)

Change %

2.9 1.1 163.3 (103.8) (40.0) 18.7 1.4 108.1 18.8

• 0.8

95.6 (81.5) (-3.7) 0.7 － 97.0 41.1 1.7 104.2 (0.7) (0.1) (114.8)

Interchange

－ － －

Pumped Storage Use

• 0.5
• 0.2

144.4

Total

47.9 2.3 104.9

Actual

• vs. FY2009/2Q

(Utilization rate)

Generated

Hydro Thermal New Energy Sources, etc. Nuclear (Water flow rate) Subtotal

Received from Other Companies

7.3 0.8 111.4

(Reposted new energy, etc.)

Trends in Generated and Received Electricity

20.5 19.6 18.7 19.7 16.3 18.8 18.9 17.3

2.7 2.3 2.7

8.0 8.3 6.1 18.8 18.7

2.9 1.8

6.8 7.4 . 7 . 7 0.0 10.0 20.0 30.0 40.0 50.0 60.0

FY2006/2Q FY2007/2Q FY2008/2Q FY2009/2Q FY2010/2Q

Nuclear Thermal Hydro Purchased power, etc. New Energy

( T W h )

4 8 . 6 4 8 . 7 4 5 . 6 <88.7> <85.0> <81.1> <85.2>

Figures inside parentheses indicate nuclear power generation capacity utilization rate (%).

4 6 . 9 <81.5> 4 7 . 9

"New Energy Sources, etc.": Generic terms for the sources of solar, wind power, biomass, waste, and geothermal powers.

SLIDE 11

■ ■ Income Statement Summary (Non Income Statement Summary (Non-

• Consolidated)

Consolidated) ■ ■ ７

(Units: Billions of Yen/%) FY2010/2Q FY2009/2Q Change

• vs. FY2009/2Q

Explanations

Lighting

287.4 277.7 9.7 103.5

Power

376.2 382.1

• 5.9

98.4

Others

30.9 24.4 6.5 126.6 Sales to other companies, 2.1; operating income from incidental

businesses, 0.7; miscellaneous income, 0.6

(Sales)

(690.1) (680.4) (9.7) (101.4) 694.5 684.2 10.3 101.5

Personnel

81.2 86.6

• 5.4

93.7 Employee retirement benefits, -5.8

Fuel

134.5 106.4 28.0 126.3 Increase in electricity sales volume, 14.9; rise in fuel price, 14.3;

increase in water flow rate, -9.5

Maintenance

83.1 90.9

• 7.8

91.4 Thermal, -9.8; nuclear, 2.0

Depreciation

97.9 98.7

• 0.8

99.1 Nuclear, -0.4; distribution, -0.3

Purchased Power

64.1 56.2 7.8 114.0 Purchased from other companies, 7.9

Interest Charges

16.2 16.7

• 0.4

97.1

Miscellaneous Taxes

48.8 48.1 0.6 101.4

Nuclear Back-End Costs *1

24.1 24.9

• 0.7

96.9

Others

90.3 92.9

• 2.6

97.2 Overhead expenses *2, -7.0; miscellaneous losses, 3.1 640.5 621.9 18.5 103.0 (71.6) (77.7) (-6.0) (92.2) 54.0 62.2

• 8.2

86.7 0.8 － 0.8 － 18.3 － 18.3 － Effect due to appropriation for asset retirement obligations, 18.3 20.2 38.7

• 18.5

52.2

Subtotal (Operating Income) Ordinary Income Quarterly Net Income

Reserve For Fluctuations In Water Level

Extraordinary Loss

* 1: Nuclear back-end costs consist of the following: Reprocessing costs of irradiated nuclear fuel, Reprocessing preparation costs of irradiated nuclear fuel, Decomissioning costs of nuclear power plants, and Disposal costs of high-level radioactive waste. * 2: Overhead expenses refer to the aggregate sum of waste disposal expenses, consumables expenses, compensation expenses, leasing fees, subcontract fees, expansion and development expenses, training expenses, research expenses and others.

Increase in electricity sales volume, 34.2 Decline in charge unit prices due to drop in fuel prices & other factors, -30.5

Ordinary Revenues

Ordinary Expenses

Subtotal

・ Expenses required for the decomission of nuclear power generation plants have always been booked as 90% of the totalestimate of what is needed for the nuclear power generation plant decommissioning reserve based on the ordinances of the Ministry of Economy, Trade, and Industry, depending on actual volume of power generated each year. ・ A recent revision of the ministerial ordinance will require lump-sum booking of an amount equivalent to the remaining 10% of the cumulative power generated up to 2009, in 2010.

[Reference] Extraordinary Losses

Key Fundamentals Exchange Rate

89 Yen/$ 96 Yen/$

• 7.0

Yen/$

Crude Oil CIF Prices

78 $/b 62 $/b 16 $/b

Water Flow Rate

103.8 % 63.8 % 40.0 %

Nuclear Power Generation Capacity Utilization Rate

81.5 % 85.2 %

• 3.7

%

FY2009/2Q Change FY2010/2Q

SLIDE 12

■ ■ Explanation of Ordinary Revenue (Non Explanation of Ordinary Revenue (Non-

• Consolidated)

Consolidated) ■ ■ ８

Note: Other income: electricity sales and other total amount Explanations

Change

Explanations

Change FY2010/2Q FY2009/2Q

• 1. Increase in electricity sales volume due to increased de

34.2

• 1. Sales to other companies

2.1 （ 3.8 ← 1.6 ）

・ Increase in electricity sales volume to other companies

・燃料費調整額（180?504億円、対前年＋324億円）

(0.4 ← 0.1 TWh; 3 TWh vs. FY2009/2Q）

• 2. Operating income from

incidental businesses

0.7 （ 12.7 ← 12.0 ）

・販売電力量の減（881?859億ｋWh、対前年?22億ｋWh）

・ Fiber optic lease line business

0.4 （ 5.6 ← 5.2 ）

• 30.5

・ Gas provider business

0.2 （ 4.9 ← 4.6 ）

◆Effect of fuel cost adjustments

• 22.7
• 3. Miscellaneous revenue

0.6 （ 1.4 ← 0.7 ）

・ Transitional measures

• 5.2 billion yen

・Profit on sale of securities

0.5

・ Special measures

• 3.2 billion yen

・Other fuel cost adjustments -14.3 billion yen

・ Increase in sales volume (43.9 ← 41.7 TWh; 2.2 TWh vs. FY2009/2Q)

• 2. Decline in charge unit price due to impact of fuel cost adjust

Others 24.7 31.0 28.9 24.4 30.9 10.0 20.0 30.0 40.0

FY2006/2Q FY2007/2Q FY2008/2Q FY2009/2Q FY2010/2Q

(Bil. Yen) Lighting & Power 655.6 666.0 689.1 659.8 663.6

500.0 550.0 600.0 650.0 700.0 750.0

FY2006/2Q FY2007/2Q FY2008/2Q FY2009/2Q FY2010/2Q

(Bil. Yen)

【 修正】 p 4 と の平仄 g e n e r a l , L a r g e

• s

c a l e i n d u s t r i a l

(Unit:Billions of Yen/%)

FY2010/2Q FY2009/2Q Change

vs FY2009/2Q

Others

30.9 24.4 6.5 126.6

(Unit:Billions of Yen/%)

FY2010/2Q FY2009/2Q Change

vs FY2009/2Q

Lighting & Power

663.6 659.8 3.7 100.6

FY2010/2Q FY 2009/2Q C hange G eneral 31 .9 30.5 1.4 ・ Tem perature effect

・ Varia tion in m eter inspectio n p erio ds (＋ 1 .45 da ys)

・ Spread of all electric houses 0.7 0.2 0.1 L arge-scale Industrial 12 .0 11.2 0.8 Increase in production of electric and transport m achinery, chem icals, and non-ferrous m etals 0.8 Factors (Unit: TW h)

SLIDE 13

■ ■ Explanation of Ordinary Expenses (Non Explanation of Ordinary Expenses (Non-

• Consolidated)

Consolidated) ■ ■ 【 【 Personnel, Fuel Personnel, Fuel 】 】 ９

Explanations

Change FY2010/2Q FY2009/2Q

Explanations

Change Employee Retirement Benefits

• 5.8 （

10.2 ← 16.0 ）

• 1. Increase in sales volume

14.9

◆Amortization cost of actuarial

• 2.9 （

1.5 ← 4.4 ）

・ Accrued in FY2004 0.8 billion yen (amortization completed in FY2009)

• 2. Rise in fuel prices

14.3

・ Accrued in FY2009 -3.8 billion yen

◆Effect of rise in fuel prices

18.7

Reference: All Japan CIF prices ・ Crude oil（ 78 ← 62$/b; 16$/b vs. FY2009/2Q） ・ LNG (570 ← 402$/t; 168$/t vs. FY2009/2Q） ・ Coal (107 ← 103$/t; 4$/t vs. FY2009/2Q） ◆Effect of exchange rate (high-yen)

• 4.4

◆Expected return on plan assets

• 2.9 （
• 2.9 ←

－ ）

Reference: Interbank Rate

・ Reevaluate FY2010 expected return on plan assets (2% ← 0%)

・ Exchange rate (89 ← 96yen/$; 7 yen/$ vs. FY2009/2Q)

・ Increase in sales volume (43.9 ← 41.7 TWh; 2.2 TWh vs. FY2009/2Q）

Fuel 99.6 141.1 179.8 106.4 134.5

50.0 100.0 150.0 200.0

FY2006/2QFY2007/2QFY2008/2QFY2009/2QFY2010/2Q

(Bil. Yen) Personnel 74.2 70.2 69.2 86.6 81.2 60.0 70.0 80.0 90.0 100.0

FY2006/2QFY2007/2QFY2008/2QFY2009/2QFY2010/2Q

( B i l . Y e n )

(Unit:Billions of Yen/%)

FY2010/2Q FY2009/2Q Change

• vs. FY2009/2Q

Personnel

81.2 86.6

• 5.4

93.7

(Unit:Billions of Yen/%)

FY2010/2Q FY2009/2Q Change

• vs. FY2009/2Q

Fuel

134.5 106.4 28.0 126.3

(Reference) Actuarial Differences

(Bil. Yen) Amount Amortized Change FY2010/2Q (A) FY2009/2Q (B) (A-B) FY2004

• 8.9
• 0.8

0.8 FY2005

• 29.5
• 2.9
• 2.9
• FY2006
• 7.0
• 0.7
• 0.7
• FY2007

33.2 3.3 3.3

• FY2008

57.0 5.7 5.7

• FY2009
• 38.1
• 3.8
• 3.8

Total 1.5 4.4

• 2.9

Year Amount

SLIDE 14

■ ■ Explanation of Ordinary Expenses (Non Explanation of Ordinary Expenses (Non-

• Consolidated)

Consolidated) ■ ■ 【 【 Maintenance, Depreciation Maintenance, Depreciation 】 】 １ ０

Explanations

Change FY2010/2Q FY2009/2Q

Explanations

Change FY2010/2Q FY2009/2Q

• 1. Thermal
• 9.8 （

12.9 ← 22.8 ）

• 1. Nuclear
• 0.4 （

18.8 ← 19.3 ）

・Reduction in maintenance work during regular maintenance

• 2. Distribution
• 0.3 （

13.5 ← 13.9 ）

• 2. Nuclear

2 （ 30.3 ← 28.3 ）

・Increase in accordance with variation in regular inspection cycle

• No. of days for nuclear power regular inspection:

＋51 days (231 days←180 days)

Depreciation 95.2 100.4 97.7 98.7 97.9

80.0 90.0 100.0 110.0 120.0

FY2006/2Q FY2007/2Q FY2008/2Q FY2009/2Q FY2010/2Q (Bil. Yen)

Maintenance 89.3 88.6 90.9 83.1 70.8

60.0 70.0 80.0 90.0 100.0

FY2006/2QFY2007/2QFY2008/2QFY2009/2QFY2010/2Q (Bil. Yen) (Unit:Billions of Yen/%)

FY2010/2Q FY2009/2Q Change

• vs. FY2009/2Q

Depreciation

97.9 98.7

• 0.8

99.1

(Unit:Billions of Yen/%)

FY2010/2Q FY2009/2Q Change vs. FY2009/2Q Maintenance

83.1 90.9

• 7.8

91.4

SLIDE 15

■ ■ Explanation of Ordinary Expenses (Non Explanation of Ordinary Expenses (Non-

• Consolidated)

Consolidated) ■ ■ 【 【 Purchased Power, Others Purchased Power, Others 】 】 １ １

Note: Others consists of interest charges, taxes, nuclear power back-end costs, and others Explanations

Change FY2010/2Q FY2009/2Q

Explanations

Change

Purchased from other companies

7.9 （ 64.0 ← 56.1 ）

• 1. Overhead Expenses
• 7.0 （

63.6 ← 70.6 ） 3.8 （ 6.7 ← 2.9 ）

・ Subcontract fees

• 3.3
• 2. Miscellaneous losses

3.1 （ 5.5 ← 2.4 ）

・ Unrealized losses on securities

3.5 1.8 （ 42.0 ← 40.2 ）

◆ Increase in purchases from

• ther thermal power companies

・ Increase in thermal power purchases (5.6 ← 5.2 TWh; 0.4TWh vs. FY2009/2Q)

◆Increase in solar power purchases

・ Communication & transport expenses

• 1.1

・ Increase in purchase prices under the System for Purchasing Surplus Solar Power (since Nov. 2009)

Others 179.6 178.9 191.9 182.7 179.5

100.0 150.0 200.0 250.0

FY2006/2Q FY2007/2Q FY2008/2Q FY2009/2Q FY2010/2Q

(Bil. Yen) Purchased Power 55.8 61.7 81.5 56.2 64.1

40.0 60.0 80.0 100.0

FY2006/2QFY2007/2QFY2008/2QFY2009/2Q FY2010/2Q

(Bil. Yen)

FY2010/2Q FY2009/2Q (Unit:Billions of Yen/%)

FY2010/2Q FY2009/2Q Change

• vs. FY2009/2Q

Purchased Power

64.1 56.2 7.8 114.0

(Unit:Billions of Yen/%)

FY2010/2Q FY2009/2Q Change

• vs. FY2009/2Q

Others

179.5 182.7

• 3.2

98.2

Reference: Actual Purchases

(TWh, Billions of Yen)

FY2010/2Q FY2009/2Q Change Power Qty 0.15 0.12 0.03 Purchase Cost 6.7 2.9 3.8

SLIDE 16

■ ■ Balance Sheet Summary (Non Balance Sheet Summary (Non-

• Consolidated)

Consolidated) ■ ■ １ ２

【 Assets】 (Unit:Billions of Yen)

• Sept. 30,

2010

• Mar. 31,

2010

Change Explanations Utility Property, Plant, and Equipment

2,535.2 2,514.2 21.0 Construction completed 105.6, depreciation -97.9

Investments & Other Assets

531.2 495.8 35.4 Long-term investment, 25.9; Ｄ eferred tax assets, 10.2

Others

765.4 766.5

• 1.1

Total

3,831.9 3,776.5 55.3 【 Liabilities & Equity】 (Unit:Billions of Yen)

• Sept. 30,

2010

• Mar. 31,

2010

Change Explanations Interest-bearing Debt

1,961.0 1,894.4 66.5 [D/E ratio]

• Sept. 30, 2010 2.00 ← March 31, 2010 1.93

Other Liabilities

888.5 898.0

• 9.6

Asset retirement obligation, 205.7; Reserves for decomissioning of nuclear power plant, -164.9; Short term liabilities of affiliated companies, -26.4; Other accounts payable, -21.9

Equity

982.3 984.1

• 1.7

2Q net income, 20.2; Dividends, -14.2; Net unrealized gains/losses on available-for-sale securities, -4.7 [ Equity Ratio]

• Sept. 30, 2010 25.6% ← Mar. 31, 2010 26.1%

Total

3,831.9 3,776.5 55.3 4 . 8

SLIDE 17

■ ■ Income Statement Summary (Consolidated) Income Statement Summary (Consolidated) ■ ■ １ ３

(Unit:Billions of Yen/%)

2Q/2010 2Q/2009 Change Vs 2Q/2009

Electric

676.4 667.4 8.9 101.3

Others

60.3 59.0 1.3 102.3 736.7 726.4 10.3 101.4 ( 1.07 ) 4.6 5.0

• 0.4

91.7 741.4 731.5 9.9 101.4

Electric

604.6 589.1 15.4 102.6

Others

55.9 54.7 1.2 102.2 660.5 643.8 16.7 102.6 23.5 20.1 3.4 117.1 684.1 664.0 20.1 103.0 (76.1) (82.5) (-6.3) (92.3) ( 1.06 ) 57.2 67.5

• 10.2

84.8 ( 1.06 ) 0.8

• 0.8
• 18.4
• 18.4
• 21.8

42.6

• 20.8

51.2 ( 1.08 )

Net Income

Reserve For Fluctuations In Water Level

Other Expenses

Subtotal Subtotal Extraordinary Losses (Operating Income) Ordinary Income

Ordinary Expenses

Ordinary Revenues Operating Revenues (Sales) Other Revenues Operating Expenses

2Q/2010 Consolidated Ratio

SLIDE 18

■ ■ Segment Information Segment Information ■ ■ １ ４

Reference: Broadband Service (BBIQ) Lines

(Unit:Billions of Yen)

677.3 65.7 41.0 12.9 797.1

• 60.3

736.7

(8.9) (-1.2) (-2.7) (0.2) (5.2) (5.1) (10.3)

676.4 26.8 28.0 5.4 736.7

(-)

736.7

(8.9) (0.3) (0.4) (0.5) (10.3) (-) (10.3)

70.5 1.2 2.2 1.7 75.7 0.4 76.1

(-6.5) (0.3) (-0.1) (-) (-6.3) (-) (-6.3)

52.7 1.2 1.6 1.3 56.8 0.3 57.2

(-9.6) (-0.3) (-0.1) (-) (-10.2) (-) (-10.2)

Note: Figures in parentheses denote change from 2Q/2009

* Ordinary income in energy-related business of 1.2 billion yen includes -100 million yen in overseas energy business (down 500 million yen from the same period previous year) Overseas energy business: Consolidated subsidiaries and equity method companies investing in businesses overseas (7 companies, including Kyuden International)

Consolidated Total Sales Eliminations/ Corporate IT and Telecommunications Other Subtotal Electric Power Energy-related Business Operating Income Ordinary Income Sales to Customers ※

Summary of Financial Results: Energy-related Business:

・ Sales decreased due to a drop in sales from power plant repair work. ・ Profits increased due to reduced depreciation cost.

IT and Telecommunications:

・ Sales decreased due to a decline in IT system development and software sales. ・ Profits were roughly level with last year due to an increase in the number of broadband service users.

Other:

・ Sales increased due to an increase in revenues related to real estate sales. Profits were roughly level with last year. V

• s. S
• ept. 30, 2009

(U nit: '000 lines) S

• ept. 30, 2010S
• ept. 30, 2009

C hange Lines 293.0 276.0 17.0 3 Y ear T rend (U nit: '000 lines) E nd of F Y 2009E nd of F Y 2008 E nd of F Y 2007 Lines 284.0 260.0 215.0

SLIDE 19

■ ■ Cash Flow Summary (Consolidated) Cash Flow Summary (Consolidated) ■ ■ １ ５

(Unit:Billions of Yen) FY2010/2Q FY2009/2Q Change Explanations

132.6 190.2

• 57.5

Decrease in income before income taxes and minority interests -29.5 Change in accounts receivable

• 25.9
• 160.3
• 121.5
• 38.8 Payments for investments and

advances/collections -33.7

(Capital Expenditures Including Nuclear Fuel)

(-124.0) (-120.5) (-3.5)

44.2

• 50.4

94.7

Increase in fund-raising due to decrease in

• perating cash flows, etc.

Change in interest-bearing debt: 95.4 (FY2010/2Q 59.9 ← FY2009/2Q -35.5）

16.4 18.1

• 1.6

8.6 69.6

• 61.0

*Free Cash Flow = Cash Flows From Operating Activities less Capital Expenditures Including Nuclear Fuel Free Cash Flows * Cash Flows from Financing Activities Cash Flows from Operating Activities Cash Flows from Investment Activities Change in Cash & Cash Equivalents

SLIDE 20

■

FY2010 Full-Year Results Forecast

SLIDE 21

■ ■ Summary, Versus Previously Announced Forecast Summary, Versus Previously Announced Forecast ■ ■ １ ６

Consolidated

(Unit: Bil. Yen, %)

Current Forecast (Oct.) Previous Forecast (Jul.)

Change

• vs. Previous

Sales

1,471.0 1,478.0

• 7.0

99.5

Operating Income

96.0 89.0 7.0 107.9

Ordinary Income

62.0 56.0 6.0 110.7

(Extraordinary Losses)

(18.4) (18.0) (0.4) (102.2)

Net Income

24.0 22.0 2.0 109.1

Non-Consolidated

(Unit: Bil. Yen, %)

Current Forecast (Oct.) Previous Forecast (Jul.)

Change

• vs. Previous

Sales

1,376.0 1,383.0

• 7.0

99.5

Operating Income

85.0 78.0 7.0 109.0

Ordinary Income

52.0 46.0 6.0 113.0

(Extraordinary Losses)

(18.3) (18.0) (0.3) (101.8)

Net Income

18.0 16.0 2.0 112.5

89.0 96.0 56.0 62.0 22.0 24.0 1,478.0 1,471.0 0.0 500.0 1,000.0 1,500.0

Previous Forecast (Jul.) Current Forecast (Oct.)

(Bil. Yen) 0.0 50.0 100.0 150.0 (Bil. Yen)

Operating income (right axis) Ordinary income (right axis) Net Income (right axis) Sales (left axis)

78.0 85.0 46.0 52.0 16.0 18.0 1,383.0 1,376.0 0.0 500.0 1,000.0 1,500.0

Previous Forecast (Jul.) Current Forecast (Oct.)

(Bil. Yen) 0.0 50.0 100.0 150.0 (Bil. Yen)

Non-Consolidated Consolidate Summary Decreased sales compared to previous forecast Increased profit level compared to previous forecast In the electricity business: ・ Decrease in electricity sales due to effect of fuel expense adjustment ・ Decrease in fuel expense due to drop in fuel prices

SLIDE 22

■ ■ Income Statement (Non Income Statement (Non-

• Consolidated) ,

Consolidated) , Versus Previously Announced Forecast Versus Previously Announced Forecast ■ ■ １ ７

(Unit:Billions of Yen) Current Forecast (October) Previous Forecast (July) Change Explanations

Lighting

584.0 579.5 4.5

Power

735.0 746.0

• 11.0

Others

63.5 63.5

• Sales to other companies, 1.0; miscellaneous income, 0.5;
• perating income from gas provider business, -2.0

(Sales)

(1,376.0) (1,383.0) (-7.0) 1,382.5 1,389.0

• 6.5

Personnel

163.0 165.5

• 2.5 Employee retirement benefits, -2.5

Fuel

271.0 276.0

• 5.0 Fall in fuel prices, -18.5; increase in electricity sales volume, 11.0

Maintenance

174.5 173.5 1.0 Meter replacement expenses, 1.0

Depreciation

199.0 201.0

• 2.0 Common depreciation, -2.0

Purchased Power

134.0 136.5

• 2.5 Purchased from other companies,-2.5

Interest Charges

32.0 32.5

• 0.5

Miscellaneous Taxes

89.0 88.5 0.5

Nuclear Back-End Costs

49.0 49.0

• Others

219.0 220.5

• 1.5 Operating expenses for gas provider business, -2.0

1,330.5 1,343.0

• 12.5

(85.0) (78.0) (7.0) 52.0 46.0 6.0 0.8

• 0.8

18.3 18.0 0.3 18.0 16.0 2.0

Ordinary Expenses

Net Income Subtotal Subtotal

Increase in electricity sales volume, 24.5; decreased charge unit prices due to effect of fuel cost adjustment, -31.0

Ordinary Revenues

Extraordinary Loss (Operating Income) Ordinary Income

Reserve For Fluctuations In Water Level

Note: Nuclear back-end costs consist of the following: Reprocessing costs of irradiated nuclear fuel, Reprocessing preparation costs of irradiated nuclear fuel, Decomissioning costs of nuclear power plants, and Disposal costs of high-level radioactive waste.

[Ref.] Maintenance & Overhead E

(Unit:Billions of Yen) Current Forecast (October) Previous Forecast (July)

Change

Maintenance expenses

174.5 173.5 1.0

Overhead expenses

159.0 159.0

• Total

333.5 332.5 1.0

R e f e r e n c e : M a i n t e n a n c e & O v e r h e a d E x p e n s e s

Key Fundamentals

Electricity Sales Volume

86.7 TWh 85.1 TWh 1.6 TWh

Exchange Rate

89 Yen/$ 95 Yen/$

• 6 Yen/$

Crude Oil CIF Prices

80 $/b 82 $/b

• 2 $/b

Water Flow Rate

102.4 % 100.0 % 2.4 %

Nuclear Power Generation Capacity Utilization Rate

80.9 % 79.6 % 1.3 %

Previous Forecast (July) Change Current Forecast (October)

SLIDE 23

■ ■ Cash Flow (Non Cash Flow (Non-

• Consolidated)

Consolidated) , , Versus Previously Announced Versus Previously Announced Forecast Forecast ■ ■ １ ８

(Unit: Billions of Yen) Current Forecast (Oct.) Previous Forecast (Jul.) Change Explanations

260.8 243.8 17.0

Ordinary income increase 6.0 Effect of accounts rec. changes 1.0

• 295.3
• 258.4
• 36.9 Payments for investments and advances -35.9

(Capital Expenditures Including Nuclear Fuel)

(-230.8) (-230.8)

• 45.8

18.5 27.3

Increase in fund-raising due to decrease in

• perating cash flows, etc.

Change in interest-bearing debt: 27.0 (October forecast 75.7 ← July forecast 48.7）

11.3 3.9 7.4 30.0 13.0 17.0

* Free Cash Flows = Cash Flows from Operating Activities less Capital Expenditures Including Nuclear Fuel Free Cash Flows Cash Flows from Financing Activities Cash Flows from Operating Activities Cash Flows from Investment Activities Change in Cash and Cash Equivalents *

SLIDE 24

■ ■ Income Statement (Non Income Statement (Non-

• Consolidated) ,

Consolidated) , Versus Previous Year Versus Previous Year ■ ■ １ ９

(Unit:Billions of Yen/%) FY2010 FY2009 Change

vs FY2009

Explanations

Lighting

584.0 566.4 17.6 103.1

Power

735.0 726.7 8.3 101.1

Others

63.5 54.0 9.5 117.6 Sales to other companies, 2.0; operating income from gas provider

business, 3.5 (Sales)

1376.0 1339.8 36.2 (102.7) 1382.5 1347.2 35.3 102.6

Personnel

163.0 172.7

• 9.7

94.4 Employee retirement benefits, -11.5

Fuel

271.0 213.0 58.0 127.2 Rising fuel costs, 38.0; increase in electricity sales volume, 23.0;

decreased nuclear power 11.0; increase in water flow rate, -10.5 Maintenance

174.5 195.1

• 20.6

89.4 General maintenance expenses, -17.5; meter replacement expenses, -3.0

Depreciation

199.0 196.7 2.3 101.1 Common depreciation, 2.5

Purchased Power

134.0 113.6 20.4 117.9 Purchased from other companies, 20.5

Interest Charges

32.0 33.1

• 1.1

96.5

Miscellaneous Taxes

89.0 89.1

• 0.1

99.8

Nuclear Back-End Costs *1

49.0 53.2

• 4.2

92.0 Reprocessing cost of irradiated unclear fuel, -3.0; decommissioning

costs of nuclear power units, -1.0 Others

219.0 230.0

• 11.0

95.2 Overhead expenses *

2, -16.3; operating expenses for gas provider

business, 4.0

1,330.5 1,296.8 33.7 102.6 (85.0) (84.9) (0.1) (100.1) 52.0 50.3 1.7 103.3 0.8

• 0.8
• 18.3
• 18.3
• Effect due to appropriation for asset retirement obligations, 18.3

18.0 28.3

• 10.3

63.6

Increase in electricity sales volume, 51.0; decreased charge unit prices due to effect of fuel cost adjustment, -25.0

Ordinary Revenues

Ordinary Expenses (Operating Income)

*1: Nuclear back-end costs consist of the following: Reprocessing costs of irradiated nuclear fuel, Reprocessing preparation costs of irradiated nuclear fuel, Decomissioning costs of nuclear power plants, and Disposal costs of high-level radioactive waste. *2: Overhead expenses refer to the aggregate sum of waste disposal expenses, consumables expenses, compensation expenses, leasing fees, subcontract fees, expansion and development expenses, training expenses, research expenses and others.

Reserve For Fluctuations In Water Level

Net Income Subtotal Extraordinary Loss Subtotal Ordinary Income

(Unit:Bil. Yen)

FY2010 FY2009 Change

Maintenanc e expenses

174.5 195.1

• 20.6

Overhead expenses

159.0 175.3

• 16.3

Total

333.5 370.4

• 36.9

Reference: Maintenance & Overhead Expenses

Key Fundamentals

Electricity Sales Volume

86.7 TWh 83.4 TWh 3.3 TWh

Exchange Rate

89 Yen/$ 93 Yen/$

• 4 Yen/$

Crude Oil CIF Prices

80 $/b 69 $/b 11 $/b

Water Flow Rate

102.4 % 76.1 % 26.3 %

Nuclear Power Generation Capacity Utilization Rate

80.9 % 84.8 %

• 3.9 %

FY2010 FY2009 Change

SLIDE 25

■ ■ Segment Information Segment Information ,Versus Previous Year ,Versus Previous Year ■ ■ ２ ０

[参考]

(Unit:Billions of Yen)

1,343.0 156.0 92.0 26.0 1,617.0

• 146.0

1,471.0

(30.9) (-7.8) (-7.1) (-0.5) (15.4) (10.7) (26.1)

83.0 5.0 4.0 3.5 95.5 0.5 96.0

(0.1) (-2.4) (-2.3) (0.3) (-4.4) (0.7) (-3.7)

49.5 6.5 3.0 3.0 62.0

• 62.0

(-0.6) (-3.5) (-1.9) (0.3) (-5.9) (0.3) (-5.6)

Note: Figures in parentheses indicate change from FY2009

* Ordinary income in energy-related business of 6.5 billion yen includes 400 million yen from overseas energy business (down 1.1 billion yen over previous year) Overseas energy business: Consolidated subsidiaries and equity method companies investing in businesses overseas (7 companies, including Kyuden International)

Operating Income Ordinary Income Electric Power Energy-related Business Consolidated Sales Eliminations/ Corporate IT and Telecommunications Other Subtotal *

Summary of Financial Results: Energy-related business: ・Both sales and profits declined due to a decline in sales for construction work and for plant- related consulting services, despite an increase in sales in the gas sales business. IT and Telecommunications: ・Both sales and profits declined due to a decline in software sales and IT systems development, despite an increase in the number of broadband service users. Others: ･Sales declined due to a drop in revenues related to real estate sales. Profits were roughly level with last year.

SLIDE 26

■ ■ Cash Flow (Non Cash Flow (Non-

• Consolidated)

Consolidated) ,Versus Previous Year ,Versus Previous Year ■ ■ ２ １

(Unit:Billions of Yen) FY2010 FY2009 Change Explanation

260.8 307.3

• 46.5

Ordinary income up 1.7 Increase in income taxes paid, etc. -29.7 Impact of payment schedules, etc -22.9

• 295.3
• 210.8
• 84.5 Payments for investments and

advances/collections -65.7 (Capital Expenditures Including Nuclear Fuel)

(-230.8) (-213.6) (-17.2)

45.8

• 124.8

170.6

Increase in fund-raising due to decrease in

• perating cash flows and other factors.

Decrease in interest-bearing debt: 170.8 （ FY2010 75.7 ← FY2009 -95.1）

11.3

• 28.3

39.6 30.0 93.7

• 63.7

* Free Cash Flows = Cash Flows from Operating Activities less Capital Expenditures Including Nuclear Fuel Free Cash Flows Cash Flows from Financing Activities Cash Flows from Operating Activities Cash Flows from Investment Activities Change in Cash and Cash Equivalents *

SLIDE 27

For more information, please contact: For more information, please contact: Investor Relations Group Investor Relations Group Strategy Planning Dept. Strategy Planning Dept. Corporate Planning Division Corporate Planning Division KYUSHU ELECTRIC POWER CO., INC. KYUSHU ELECTRIC POWER CO., INC. Telephone Telephone : +81 92 726 1575 : +81 92 726 1575 Facsimile Facsimile : +81 92 733 1435 : +81 92 733 1435 URL URL : http:// : http://www.kyuden.co.jp/en_ir_index www.kyuden.co.jp/en_ir_index